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JetBlue (JBLU) Posts Solid Traffic on High Travel Demand

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JetBlue Airways Corporation (JBLU - Free Report) reported impressive traffic figures for August 2018. Traffic (measured in revenue passenger miles or RPMs) improved 6.7% year over year to 4.7 billion. On a year-over-year basis, capacity (or available seat miles/ASMs) climbed 4.8% to 5.3 billion.

Owing to traffic growth outpacing capacity expansion, load factor (percentage of seats filled by passengers) expanded 160 basis points (bps) to 88.7%. The low-cost carrier registered a completion factor (system wide) of 97.4% in the month with 66.7% flights on schedule.

At the end of the first eight months of 2018, JetBlue generated RPMs of 34.4 billion (up 6% year over year) and ASMs of 39.8 billion (up 4.7% year over year). Consequently, load factor registered a rise of 100 basis points year over year to 86.3%.

 

The Long Island City, NY-based carrier maintains projections for revenue per available seat mile (RASM) growth in the range of 1-3% for the third quarter. Recently, JetBlue made the headlines when it increased fees for checked bags and ticket changes to combat the threat posed by rising fuel costs. For the first checked bags, the carrier hiked the fee to $30 from $25. Fees for the second and third checked bags have also been increased.

Moreover, as a part of its expansion endeavors, JetBlue recently started operating non-stop flights between New York’s John F. Kennedy Airport and Southern California’s Ontario International Airport. The initiative catered to the needs of coast-to-coast travelers and provided other improved amenities.

Zacks Rank & Key Picks

JetBlue carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the broader Transportation Sector are Old Dominion Freight Line, Inc. (ODFL - Free Report) , SkyWest, Inc. (SKYW - Free Report) and Trinity Industries, Inc. (TRN - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Old Dominion, SkyWest and Trinity have gained 13.1%, 4.8% and 9.4% in the past six months, respectively.

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